New HMRC data shows VGTR has paid out £1.48bn

TIGA :

3rd September 2024
 

The Government has released new data showing that Video Games Tax Relief (VGTR) has boosted UK-based games studio production by nearly £1.5 billion since 2014. 
 
TIGA analysis also shows that HMRC has revised total VGTR payouts upwards by £68 million for financial year 2022 compared to its 2023 report. 
 
TIGA successfully campaigned for the introduction of Video Games Tax Relief, which came into effect in 2014. VGTR has enabled the UK to compete on a more level playing field against games industries in other jurisdictions which benefit from generous incentives. 
 
VGTR has also played a significant role in creating thousands of highly skilled jobs: UK development staff have increased from 10,900 people in December 2014 to over 24,000 in April 2023.
 
Contrary to HMRC’s 2023 Creative Industry Statistics report, which stated that VGTR payouts had dropped by 6 per cent to £189 million in financial year 2021-2022, HMRC now says in its 2024 report that in fact VGTR payouts rose by 18 per cent to £257 million.
 
Instead of a £12m drop in VGTR payouts, HMRC now records a £40m increase in VGTR payouts, from £217 million in 2020-21 to £257 million.[1] TIGA research shows that this £68 million revision is the largest recorded annual revision by HMRC since the Relief became available in 2014.
 
HMRC also released its provisional data financial year 2023, suggesting that £282 million was paid out to UK based games studios in the financial year, a 10 per cent increase in value compared to financial year 2022. 
 
The proportion of claims worth over £500,000 increased from 78 per cent in financial year 2022 to 87 per cent in financial year 2023. The proportion of claims worth under £50,000 decreased from 5 per cent in financial year 2022 to just 1 per cent in financial year 2023, despite representing 42 per cent of total claims. We note that all data from financial year 2021 onwards remains provisional.
 
The Government announced in March 2023 that Video Games Tax Relief will be replaced with a Video Games Expenditure Credit (VGEC), which has been effective since January 2024.
 
Dr Richard Wilson OBE, TIGA CEO, said:
 
“Our studios have relied on VGTR to help us compete on a more level playing field when other territories such as Canada, France and many US states offer more generous incentives than the UK’s. This revised data shows that VGTR is being accessed by more and more games companies with greater production values every year.”
 
“VGTR has played a critical role in driving growth in the UK video games industry, Employment in our industry grew from 10,900 development staff in December 2014 to over 24,000 in April 2023. Video Games Expenditure Credit (VGEC), which is replacing VGTR, must be kept competitive if we are to continue to attract foreign direct investment and maximise employment growth in our video games industry.”
 
Notes

In 2023, HMRC reported that VGTR had paid out £189m in financial year 2022: https://www.gov.uk/government/statistics/creative-industries-statistics-august-2023/creative-industries-statistics-commentary-august-2023#video-games-tax-relief
 
¹ In 2024, HMRC reported that VGTR had paid out £257m in financial year 2022: https://assets.publishing.service.gov.uk/media/66cdae7003c7db1b41c70901/Creative_Industries_tables_august_2024.ods


The difference between these two calculations equates to £68 million.


About TIGA
 
TIGA is the trade association for the UK video games industry. Since 2010, TIGA has won 28 business awards and commendations. Our vision is to make the UK the best place in the world to develop video games. Our core purpose is to strengthen the games development and digital publishing sector. To this end, TIGA
 

 
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